Centre for the Study of African Economies Development and Security Anke Hoeffler Centre for the Study of African Economies Department of Economics, University of Oxford

Centre for the Study of African Economies Fragile States Definition? Security/public goods 1bn people About 7% live in LICUS 15% of the world’s poor Projection: 30% of the world’s poor in 2015

Centre for the Study of African Economies Fragile States Cost? Poverty ($32bn) War ($3bn) Region ($237bn) About $270bn Aid currently about $80bn UN target $130bn Chauvet, Collier and Hoeffler 2011

Centre for the Study of African Economies Bottom Billion – Development Traps Conflict Trap Natural Resource Trap Landlocked with Bad Neighbours Bad Governance in a Small Country

Centre for the Study of African Economies Conflicts: Global Prevalence

Centre for the Study of African Economies Conflicts: Global Prevalence

Centre for the Study of African Economies Conflict and War: Global Prevalence

Centre for the Study of African Economies Total Battle Deaths (in Millions)

Centre for the Study of African Economies Battle and War Deaths in Selected African Countries CountryYearsTotal DeathsBattle Deaths% Battle Deaths Angola million160,50011% Mozambique mill.145, % Sudan million55,0003% DRC million145,0006%

Centre for the Study of African Economies Refugees, IDPs and Others of Concern (in Millions)

Centre for the Study of African Economies Civil War Research OnsetDurationPost-War

Centre for the Study of African Economies Collier-Hoeffler Model of Civil War Aim: model and estimate what factors make a country more prone to large scale violent internal conflict Method: regression analysis Collier and Hoeffler, 2004

Centre for the Study of African Economies Explanations of Civil War Onset Economics Political Science Sociology History Geography Demography risk = f(history, economy, sociology...)

Centre for the Study of African Economies Conclusions Little evidence for grievances as a sufficient determinant of conflict Economic factors are important (level, growth and structure of income, sources of finance) Past conflict makes a country more conflict prone The longer the peace lasts the less likely is a new outbreak

Centre for the Study of African Economies Natural Resources and the Risk of Civil War C&H: Countries with natural resources are more conflict prone risk natural resources

Centre for the Study of African Economies Interpretation: Civil war? – recruit and maintain private army Finance? - natural resources Examples: drugs, diamonds, timber

Centre for the Study of African Economies Measurement of Natural Resources Natural resource exports as a % of GDP Point/diffuse natural resources Dummy variable (e.g. oil exporter) Natural resource rents (price-cost) Stock of natural resources

Centre for the Study of African Economies Where is the Wealth of Nations? Data source: World Bank (2006) and own calculations Region Subsoil assets/km2 (in USD) World105,000 Africa23,000 South Asia53,000 LAC95,000 MENA361,000 East Asia&Pacific77,000 ECA93,000 OECD114,000

Centre for the Study of African Economies Possible Interpretations: Finance Lujala et al Honey Pot Humphreys 2005, Neumeyer&de Soysa Weak state capacity Fearon&Laitin 2003, Sachs&Warner 2007

Centre for the Study of African Economies Summary of the Evidence: Evidence that natural resource rich countries are conflict prone Measurement issues Results are difficult to interpret, endogeneity and simultaneity problems Transmission channels from natural resources to civil war risk are diverse

Centre for the Study of African Economies Does natural resource scarcity cause violence? Ecoviolence Burk et al 2009 No current evidence for ‘ecowars’ Gleditsch, 1989; de Soysa, 2002, Buhaug 2010 Little evidence that climate change will cause more wars Hendrix&Glaser, 2007

Centre for the Study of African Economies Concluding Comments Correlation/causation? Evidence that countries rich in natural resources are at higher risk of war Finance, honey pot, weak state capacity Kimberley Process Extractive Industries Transparency Initiative Resource Charter

Centre for the Study of African Economies International Initiatives EITI Kimberley Process The Natural Resource Charter

Centre for the Study of African Economies Civil War Research OnsetDurationPost-War

Centre for the Study of African Economies Duration of War Duration is not determined by the same variables as the initiation An increase in natural resource prices tends to increase the duration of war

Centre for the Study of African Economies Post-Conflict Challenges Economic RecoveryRisk Reduction

Centre for the Study of African Economies Economic Recovery Is there a peace dividend? Does aid increase growth post-conflict? Does policy improve growth post-conflict?

Centre for the Study of African Economies Empirical Analysis of Post-Conflict Societies Peace dividend, about 1.1% extra growth 3-7 years during post conflict aid increases growth Traditionally this is not what donors have done Peace dividend only if there is no further violence

Centre for the Study of African Economies Post Conflict Risks 68 post-conflict episodes 46% of cases recurrence of war 40% of cases recurrence within a decade

Centre for the Study of African Economies Statistical Results There is no safe period during the decade Growth is important, stagnant economies 42% risk,10% income growth 26.9% risk Elections shift the risk, lower in election year, higher after, subsequent elections don’t have a different effect to first elections PK force absolute not relative size matters (deterrence) Doubling expenditure reduces risk from 40% to 31%

Centre for the Study of African Economies Bibliography Fragile States Chauvet L., P. Collier and A. Hoeffler, The Cost of State Failure and the Limits to Sovereignty, in: Fragile States: Causes, Costs, and Responses. Naudé, W.A., Santos-Paulino, A. and McGillivray, M. (eds).Oxford: Oxford University Press. Collier, Paul The Bottom Billion. Why the Poorest Countries are Failing and What Can Be Done About It. Oxford University Press. Civil War Collier, Paul and Anke Hoeffler Greed and grievance in civil wars, Oxford Economic Papers 56:663– 595. Collier, Paul, Anke Hoeffler and Dominic Rohner Beyond Greed and Grievance: Feasibility and Civil War. Oxford Economic Papers 61: Collier, Paul, Hoeffler, Anke and Måns Söderbom On the Duration of Civil War. Journal of Peace Research 41(3): Collier, Paul, Lance Elliot, Håvard Hegre, Anke Hoeffler, Marta Reynal-Querol and Nicholas Sambanis Breaking the Conflict Trap: Civil War and Development Policy, World Bank Policy Research Report. Oxford: Oxford University Press. Fearon, James and David Laitin Ethnicity, insurgency, and civil war, American Political Science Review 97:75–90. Hegre, Hårvard, Tanja Ellingsen, Scott Gates and Nils Petter Gleditsch Towards a democratic civil peace? American Political Science Review 95:33–48. Hoeffler, Anke On the Causes of Civil War, 2011, Chapter 1 in the Oxford Handbook of the Economics of Peace and Conflict (Michelle Garfinkel and Stergios Skaperdas, eds). forthcoming. Miguel, E., S. Satyanath and E. Sergenti (2004), Economic shocks and civil conflict: An instrumental variables approach, Journal of Political Economy 112:725–753. Regan, Patrick Sixteen Million One. Paradigm Press.

Centre for the Study of African Economies Bibliography Natural Resources and Development Auty, Richard Resource abundance and economic development. Oxford: Oxford University Press. Collier, Paul The Bottom Billion: Why the poorest countries are failing and what can be done about it. Oxford: Oxford University Press. Isham, Jonathan, Woolcock, Michael, Pritchett, Lant and Gwen Busby The Varieties of Resource Experience: Natural Resource Export Structures and the Political Economy of Economic Growth. World Bank Economic Review 19(2): Sachs, Jeffrey and Andrew M. Warner ‘Natural Resource Abundance and Economic Growth’. In Leading Issues in Economic Development, 7 th ed. G.M. Meier and J.E. Rauch, Oxford: Oxford University Press. Civil War and Natural Resources le Billon, Philippe The political ecology of war: natural resources and armed conflicts. Political Geography 20: 561–584. Buhaug, Halvard Climate not to blame for African civil wars. Proceedings of the National Academy of Sciences. Early Edition. Burke MB, Miguel E, Satyanath S, Dykema JA, Lobell DB Warming increases the risk of civil war in Africa. Proceedings of the National Academy of Sciences 106:2067–2070. Collier, Paul and Anke Hoeffler Resource Rents, Governance, and Conflict, Journal of Conflict Resolution 49: Dube, Oeindrila and Juan F. Vargas Are All Resources Cursed? Coffee, Oil, and Armed Conflict in Colombia. Weatherhead Center of International Affairs, Harvard University, Working Paper Fearon, James Primary commodities exports and civil war. Journal of Conflict Resolution 49 (4): Gleditsch, Nils Petter Armed conflict and the environment: a critique of the literature. Journal of Peace Research 35(5):

Centre for the Study of African Economies Bibliography continued Civil War and Natural Resources Hendrix, Cullen and Sarah M. Glaser Trends and triggers: Climate, climate change and civil conflict in Sub- Saharan Africa. Political Geography 26: Homer-Dixon, Thomas Environment, scarcity, and violence. Princeton: Princeton University Press. Humphreys, Macartan Natural resources, conflict, and conflict resolution: Uncovering the mechanisms. Journal of Conflict Resolution 49 (4): Lujala, Paivi, Nils Petter Gleditsch and Elizabeth Gilmore A diamond curse? Civil war and a lootable resource. Journal of Conflict Resolution 49:538–562. Ojefusi, Aderoju Oil and the Probability of Rebel Participation among Youths in the Niger Delta of Nigeria. Journal of Peace Research 45(4): Ross, Michael L What Do We Know about Natural Resources and Civil War? Journal of Peace Research 41: de Soysa, Indra Ecoviolence: shrinking pie, or honey pot? Global Environmental Politics 2(4): de Soysa, Indra and Eric Neumayer Natural Resource Wealth and the Risk of Civil War Onset: Results from a new dataset of natural resource rents Conflict Management and Peace Science 24: Weinstein, Jeremy M Resources and the Information Problem in Rebel Recruitment. Journal of Conflict Resolution 49:

Centre for the Study of African Economies Bibliography continued Post-War Collier, Paul, Anke Hoeffler and Måns Söderbom Post-Conflict Risks, Journal of Peace Research 45(4): Collier, Paul and Anke Hoeffler Military Expenditure in Post-Conflict Societies, Economics of Governance 7(1): Collier, Paul and Anke Hoeffler Aid, Policy and Growth in Post-Conflict Countries.The European Economic Review 48: Hoeffler, Anke, Syeda ShahBano Ijaz and Sarah von Billerbeck Post-conflict Recovery and Peace Building, Background Paper for the World Development Report mimeo.